First Time Buyers

First time buyers now account for only 15 percent of new mortgages. Nevertheless, the number has recovered slightly relative to a year ago.

How should we interpret the increasing proportion of first time buyers? Overall, mortgage activity is a fraction of what it was before the crisis. There are few signs of a sustained recovery in lending.

At the same time, lending rates are at an all time low, and prices appear to have stabilised. The combined effect of lower rates and remortgaging has reduced mortgage costs for existing home owners. This has kept a cap on arrears, which have stabilised at around 3 percent of all mortgages.

Economic policy has long favoured debtors at the expense of savers. It has favoured homeowners over renters, and speculators over producers.